Acquisition & Development

Raw land infrastructure development (streets, utilities, etc.)

Adjustable Commercial Mortgage

Interest moves with a specific index (Prime, T-Bills, etc.)

Construction /Mini-Perm

Construction with 3 to 5 year loan, usually on income property.

Construction with Takeout Package

Construction with pre-arranged takeout loan in place.

Fixed Rate Commercial Mortgage

Interest Rate remains constant throughout the term.

Forward Commitment

Pledge to provide a loan at a future date.

Ground Lease

Lender retains title to the land. Borrower pays land leasing fees to lender for a fixed period of time.

Interim Loan

A short term (2 yrs or less), bridge or project type loan.

Joint Venture

A financial partner in the development of real estate.

Mortgage Note Buyers

Individuals or companies that buy existing commercial mortgages.

Non-Construction Mini-Perm

A three to five year loan, usually on income property.

Participating Construction with Takeout

Lender receives a kicker for profits above a preset level.

Participating Mortgage

Lender receives a kicker for gross income above a preset level.

Permanent with Accrual

Loan interest is accounted for but not paid for some period.

RE Sale and Leaseback

Lender purchases land and leases back to borrower (generally developer) for a fixed rent plus other considerations. Mortgages are issued on leasehold at market rates. Usually, produces more dollars than a mortgage.

Real Estate Purchase

Lending for the purchase of commercial real estate.

Second Mortgage (Commercial)

Loan secured by equity behind that of the first lien.

Securitization/Syndication

Bundling of mortgage notes for sale on the secondary market.

Standby

Loan commitment not expected to be used (safety net for trouble).

Wraparound

Lender makes a second mortgage and assumes the first mortgage.

  Documentation Needed for Real Estate Finance

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